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Vickie Romanchuk Gartner

Blockchain: How Real Is The Market?

Rajesh Kandaswamy
Research Director

4 years at Gartner, 23 years industry experience

He provides strategy and marketing direction for technology and service
providers by helping them understand key issues, market dynamics, @rajeshkan
trends, best practices, competitive landscapes and future scenarios.
Among provider segments, he has a deeper coverage of services,
software, outsourcing and BPO. His coverage is global, with a deeper https://www.linkedin.com/in/rajesh-kandaswamy-178222/
focus on North America. Mr. Kandaswamy has been frequently quoted
in leading publications on items related to banking, blockchain and http://blogs.gartner.com/rajesh-kandaswamy/
fintech.
For a broader insight into Gartner you can find us: @Gartner_inc on Twitter and Gartner on LinkedIn.
 $176 B
Business value-add of
blockchain by 2025

2 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

© 2017 Gartner, Inc.

Key Issues

1. What is the current state of the blockchain market?

2. What can we expect in the near future?
3. What should technology and service providers do about it today?

3 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

Blockchain Offers Unique Benefits

 Improve trust in an
untrusted
environment

 Immutability of
records

 Traceability of
records

4 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

How Does Blockchain Work?

Network member Nodes add the Nodes use consensus The confirmed
proposes new proposed transaction algorithms to confirm block is appended
transaction to other proposed and add block to the to the blockchain
transactions into a blockchain
block

Block No. 2B4 Block No. 76F Block No. 8FA

Block No. 2B4 Prev.: No. 473 Prev.: No. 2B4 Prev.: No. 76F
Prev block: …
Transactions: Time
Txn. 817 ...
Txn. F76 …

5 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

 DTCC is building
a distributed
ledger solution
for post-trade
processing. This
will enhance the
system that
supports $11T
credit derivatives
6 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.
 Decentralized
network that
connects
carriers, banks,
forwarders,
traders and
other parties

7 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

Blockchain Activity Is Seen In Most Industries

Investment
Government Banking Insurance
Services

Media & Healthcare & Sharing

Supply Chain
Entertainment Pharma Economy

Client Internet of
Agriculture Utilities
Auditing Things

Retail & E- Disruptive Precious

Education
commerce Start-ups Metals

8 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

 What
What’s platform
next after should I
my PoC? use?

9 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

 9 of 10
enterprises
will do a
blockchain
project

10 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

Business value-add of Blockchain - $176 billion by 2025,
$3.1 trillion by 2030

11 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

Blockchain Projects Vary In Their Value Proposition

Between Companies

Intracompany

Public Record

Auto-Adjudication

Digital Cash

12 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

Poll: Do You Have A Strategy For
Blockchain?

1. We already have a strategy

2. We plan to develop a strategy
3. We do not plan to develop a strategy
(because it is not relevant or not needed)

13 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

Strategic Planning Assumptions

 Through 2018, 85% of blockchain-named projects will

deliver business value without using a blockchain.

 By 2022, a blockchain-based business will be worth

$10 billion.

14 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

 The Ecosystem Is Fluid With No Clear Winners And Blurry
Categories Infrastructure Software

Professional Services

Smart Contracts

Financial Services

Boutique Services
Distributed Ledgers

15 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

Blockchain Offers Much Potential, But Not There Yet

Myth Reality
Financial Services + Other
Only for Financial Services
Industries
Mostly Proof of Concepts and Pilots
Transformation Is Occurring
Now

Disruptive Technology Disruptive Immature Technology

Cost Saving, Revenue Generating

Cost Saving Projects
And Other Projects

16 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

What Can We Expect In The Near Future?

 More ‘Proof of Concept’ work by more companies in most

sectors
 Initial production deployments by select enterprises,
marketplaces, central utilities and disruptors.
 Platforms continue to evolve leading to eventual
consolidation (a year or more out).
 More investment and attention from traditional technology
and service providers.

17 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

Recommendations to TSPs

 Develop a Blockchain strategy - help clients create viable business

cases and plans that go beyond proofs of concept (POCs).
 Prepare for blockchain integration in your products and services by
performing a gap analysis against what is needed.
 Get involved in the blockchain ecosystem by engaging with open-
source communities, consortiums and alliances.
 Prioritize financial services, government, central utilities in certain
industries and supply chain market leaders.

18 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

Recommended Gartner Research

 Practical Blockchain: A Gartner Trend Insight Report (27 reports)

David Furlonger and Ray Valdes (G00325933)
 Five Essential Actions to Prepare TSPs for the Enterprise Blockchain Market
Rajesh Kandaswamy, Jacqueline Heng and Moutusi Sau (G00323012)
 Market Trends: Look Beyond Technology to Succeed in Blockchain
Rajesh Kandaswamy, Derry Finkeldey and Moutusi Sau (G00316175)
 Hype Cycle for Blockchain Technologies and the Programmable Economy,
2016
David Furlonger and Ray Valdes (G00308190)

19 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

 "We always overestimate the change that will occur
in the next two years and underestimate the
change that will occur in the next ten.
Don't let yourself be lulled into inaction.”
– Bill Gates

20 © 2016 Gartner, Inc. and/or its affiliates. All rights reserved.

 Accelerating Digital Business: Webinar attendees
Performing While Transforming Save $325 off standard
June 19 – 21, 2017 / Huntington Beach, CA registration rates
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With a broad range of perspectives on:
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Thank you — Don’t
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Vickie Romanchuk Gartner

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